When do you report Cryptocurrency investments?

[aarel716]

Say you buy some Crypto with 1000 USD and you hold the coin never selling it but the value goes up 50% do you pay taxes on that or when you cash out the coin back to USD?

[DoninGA · Accepted solution]

You only report the gain or loss when the property is sold.

[daveb12990]

I found a solution for high-frequency traders! I'm using CoinTracking (10% discount using this link [remove] – CoinTracking provides a TurboTax TXF file you can import into Form8949.com. I paid $190 for CoinTracking (Unlimited for 1 Year), and $28 for Form8949.com. Form8949.com sent the data to my TurboTax Online account. Because I had 4000+ cryptocurrency trades, it added "summary" information, and then it also provided me with 120 pages I had to print out, and mail to the IRS so that they have each individual trade on file. A side note though.. you're going to run into a slew of issues using CoinTracking if you are trying to set it up NOW, as opposed to setting it up for a new cryptocurrency portfolio, therefore.. I did my best to manually add trades, transfers, and transactions for the 2017 tax year, but then I wiped the entire CoinTracking history, and started fresh with API Keys linking Coinbase, GDAX, Bittrex, Cryptopia, and HitBTC so that all of my trades, transfers, and transactions are now being tracked automatically (set API Key DATE to the current date and time to only receive API Key data now, and avoid the API sending previous data, which is most likely messed up if you haven't been tracking this entire time). Join our Facebook group if you want to post a question or send me a message (good luck!): [remove]